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In 2011, XL Catlin’s Design Professional team and PSMJ Resources, Inc. announced a collaborative agreement to share knowledge, develop custom research tools, analyze trends in new ways, and develop reports and educational materials to advance A/E firms’ risk and practice management efforts.

Most firms focus on the financial outcomes of their projects. These metrics typically gauge the efficiency of how well the project was completed. Firm leaders want to understand which projects created more than the firm’s average profit, and which projects only broke even or lost money. Often, this pushes project managers with poor profits to force their costs down, which reduces the amount and/or quality of effort spent helping clients. This tends to reduce a firm’s value to clients, a serious problem for any firm. The goal is to increase value to clients to improve loyalty and set the stage for better profits.

The simplest, most direct method for improving your firm’s value to the client is to measure it. Measuring a client’s perception of a firm’s value, if done properly, not only identifies how to improve, but the act of measuring actually promotes improved client focus and awareness of client needs. 

To collect the most helpful client feedback, your survey questions must identify how the firm’s process compared to each client’s expectations. Client expectations vary tremendously, even among the same client, and are rarely communicated proactively to the designer. It’s also important to collect client feedback as services are rendered, not just at the end of a project. By charting financial results (efficiency) with client feedback (effectiveness), firm leaders can see their current results and understand how to successfully improve.

The quadrant chart (see Figure 1) plots project profit and client feedback together. This lets firm leaders see both their internal and external results for a more complete view of their firm’s current status. On the profit scale, set the midpoint as the “Average Project Profit” over the past twelve months. On the feedback scale, set the midpoint as “Met Client Expectations.” The purpose of the midpoints is for the chart to display where results are positive (and bear repeating) versus where results are problematic (and need refinement). Figure 1Graph-Measuring what matters

 

The names given to the four quadrants—Poor Fit, Potential, Expert and Burn Out—help identify results in terms of what can likely be improved. Any results below “Met Client Expectations” indicate some degree of problem with the client that, if not addressed, will tend to worsen. Addressing the matter is made easier by referring to the client’s feedback to spot the issue. Results above “Met Client Expectations” indicate that a client’s expectations were exceeded. Since most clients expect to get their money’s worth, exceeding their expectations can lead to increased billings for additional services and project fees.

By measuring what matters and plotting project results (both profit and client feedback), it becomes immediately apparent not only how well the project manager’s process worked, but also what to do to improve results going forward. SHARE THIS ARTICLE- DOWNLOAD THE PDF HEREAbout the AuthorMike Phillips, AIA is President of Phillips Architecture, a PSMJ Circle of Excellence firm in Raleigh, NC, and creator of the ClientFeedbackTool, the survey system customized for A/E firms and offered by PSMJ.

The information contained herein is intended for informational purposes only and does not constitute legal advice. For legal advice, seek the services of a competent attorney. Any descriptions of insurance provisions are general overviews only. 

XL Catlin is the global brand used by XL Group Ltd’s insurance subsidiaries. In the US, the insurance companies of XL Group  Ltd are: Catlin Indemnity Company, Catlin Insurance Company, Inc., Catlin Specialty Insurance Company, Greenwich Insurance Company, Indian Harbor Insurance Company, XL Insurance America, Inc., XL Insurance Company of New York, Inc., and XL Specialty Insurance Company. Not all of the insurers do business in all jurisdictions nor is coverage available in all jurisdictions. Information accurate as of May 2015.

©2015, X.L. America, Inc.

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Global Asset Protection Services, LLC, and its affiliates (“AXA XL Risk Consulting”) provides risk assessment reports and other loss prevention services, as requested. This document shall not be construed as indicating the existence or availability under any policy of coverage for any particular type of loss or damage. AXA XL Risk. We specifically disclaim any warranty or representation that compliance with any advice or recommendation in any publication will make a facility or operation safe or healthful, or put it in compliance with any standard, code, law, rule or regulation. Save where expressly agreed in writing, AXA XL Risk Consulting and its related and affiliated companies disclaim all liability for loss or damage suffered by any party arising out of or in connection with this publication, including indirect or consequential loss or damage, howsoever arising. Any party who chooses to rely in any way on the contents of this document does so at their own risk.

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In the US, the AXA XL insurance companies are: AXA Insurance Company, Catlin Insurance Company, Inc., Greenwich Insurance Company, Indian Harbor Insurance Company, XL Insurance America, Inc., XL Specialty Insurance Company and T.H.E. Insurance Company. In Canada, coverages are underwritten by XL Specialty Insurance Company - Canadian Branch and AXA Insurance Company - Canadian branch. Coverages may also be underwritten by Lloyd’s Syndicate #2003. Coverages underwritten by Lloyd’s Syndicate #2003 are placed on behalf of the member of Syndicate #2003 by Catlin Canada Inc. Lloyd’s ratings are independent of AXA XL.
US domiciled insurance policies can be written by the following AXA XL surplus lines insurers: XL Catlin Insurance Company UK Limited, Syndicates managed by Catlin Underwriting Agencies Limited and Indian Harbor Insurance Company. Enquires from US residents should be directed to a local insurance agent or broker permitted to write business in the relevant state.